The Australian dollar continued its impressive rally, soaring to 0.7484 up 0.8%, six days upside in a row. This is backed by commodities uplift as iron ore jumped 19%, the biggest daily gain since 2009 and WTI Oil up 5.7%. Traders are surprised by the jump, as market reacted to China’s annual congress economic targets and plan to cut overcapacity in steel, potentially curbing demand for iron ore.
Commodities will be closely watched today as China release its trade balance figures (forecast +339bn USD). Iron ore price at Dalian commodity exchange, Oil prices and copper are likely to be the main drivers for the Australiam dollar and ASX listed mining and energy companies.
The focus later this week will be on the European Central Bank meeting on Thursday. Market expectation of further easing is high and how much ECB President’s Mario Draghi will deliver on his promises, to lift inflation and growth in Europe.
Currency Updates:
EUR/USD Intraday: the bias remains bullish.
Pivot: 1.0945
Our preference: long positions above 1.0945 with targets @ 1.1070 & 1.1100 in extension.
Alternative scenario: below 1.0945 look for further downside with 1.0890 & 1.0850 as targets.
Comment: the RSI is mixed with a bullish bias.
Supports and resistances:
1.1135 ***
1.1100 ***
1.1070 ***
1.1013 Last
1.0945 ***
1.0890 ***
1.0850 **
USD/JPY Intraday: turning down.
Pivot: 113.50
Our preference: short positions below 113.50 with targets @ 112.50 & 112.10 in extension.
Alternative scenario: above 113.50 look for further upside with 114.25 & 114.55 as targets.
Comment: the RSI is bearish and calls for further downside.
Supports and resistances:
114.55
114.25
113.50
112.90 Last
112.50
112.10
111.60
GBP/USD Intraday: the upside prevails.
Pivot: 1.4131
Our preference: long positions above 1.4131 with targets @ 1.4305 & 1.4405 in extension.
Alternative scenario: below 1.4131 look for further downside with 1.4020 & 1.3980 as targets.
Comment: the RSI is mixed to bullish.
Supports and resistances:
1.4515 **
1.4405 ***
1.4305 ***
1.4256 Last
1.4131 **
1.4020 ***
1.3980 ***
AUD/USD Intraday: bullish bias above 0.7385.
Pivot: 0.7385
Our preference: long positions above 0.7385 with targets @ 0.7495 & 0.7530 in extension.
Alternative scenario: below 0.7385 look for further downside with 0.7345 & 0.7295 as targets.
Comment: even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
Supports and resistances:
0.7560
0.7530
0.7495
0.7455 Last
0.7385
0.7345
0.7295
SPI 200 (ASX) (H6) Intraday: the upside prevails.
Pivot: 5110
Our preference: long positions above 5110 with targets @ 5200 & 5225 in extension.
Alternative scenario: below 5110 look for further downside with 5075 & 5040 as targets.
Comment: even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
Supports and resistances:
5250
5225
5200
5140 Last
5110
5075
5040
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